Per capita GDP predicted to soar by 2030

By Fu Jing (China Daily)
Updated: 2008-03-26 08:59

China's per capita GDP will reach the 1990 level of Western Europe and Japan of around $18,000 by 2030, an economist said yesterday.

Pioneering British economist Angus Maddison also predicts the country could be reinstated as the world's biggest economy by 2015 after losing the top rank two centuries ago, in his book, Chinese Economic Performance in the Long Run, launched in Beijing yesterday.

But Chinese economists are reserved when it comes to the predictions. Some said it would be impossible for China to overtake the United States by 2015 and that Maddison has overestimated the country's economic strength. Others insisted factors such as education, healthcare and human resources should be taken into consideration when ranking economies.

In 1820, China was the world's biggest economy.

After analyzing the country's economic data for the past 1,000 years, Maddison forecast China's economy could reach $12,271 trillion by 2015 - 7 percent more than the projected US figure.

By 2030, Maddison predicts China's economy will be 138 percent of the US economy. But in 1990, China's economy was only 37 percent of the US economy. In 2003, that ratio was 73 percent.

Maddison based his analysis and forecast on "purchasing power parity", or PPP, a measure of the cost of living based on the goods and services households can buy with their currency.

"The major message is that China will overtake the United States and reassume its historical position as the largest economy on the planet," Angel Gurria, secretary-general of the Organization for Economic Cooperation and Development, said at the book launch yesterday.

"He even puts a date on it - 2015, a mere seven years from now," Gurria said.

Chinese economist Ren Ruo'en said he didn't agree with the forecast, which was based on an earlier benchmark.

"We have already readjusted our benchmark and our consensus is that the Chinese economy may be 40 percent smaller than previously estimated," Ren, a professor at Beijing's Beihang University, said.

The World Bank's recent report ranking world economies for 2005 used PPP. It shows China's GDP as $5.3 trillion and not the $8.8 trillion cited in previous World Bank surveys.

Ren said the World Bank is working closely with Chinese statisticians to readjust the figures.